September 22, 2009
South Africa-Iran Foreign Relations
In 1997, Nelson Mandela’s government discussed selling enrichment expertise from its own nuclear program to Iran. Javad Vaidi, an Iranian official from the Islamic Republic’s National Security Council, reported that South Africa even offered to sell uranium oxide concentrate to Iran and proposed to take part in the stalled enrichment activities in a memorandum of understanding signed in December 2005. Iran could use the highly reactive uranium oxide in its reactors at Isfahan and Bushehr as part of a nuclear program that already has caused great international concern over its secrecy and repeated disregard for International Atomic Energy Agency (IAEA) regulations. South Africa has publicly denied agreeing to take part in any enrichment activities.
In July 2008, South Africa reiterated its position on Iran’s right to peaceful nuclear technology and claimed that the IAEA, not the UN Security Council, should deal with the issue. South Africa has insisted that once Iran’s program is deemed peaceful by the IAEA, the international community should treat Iran with equal nuclear rights. South Africa has called for the United States and Israel to cease their threats against Tehran and its nuclear program and has suggested that all embargos, including arms and financial bans, against the Islamic Republic and the Revolutionary Guard be dropped in order to encourage more diplomatic engagement. Despite claiming that it wants to ensure that Iran does not use its nuclear program to create nuclear weapons, South Africa has repeatedly spoken out against confrontation that could threaten both regional and international peace.
Following the United Nations Security Council’s adoption of the third binding resolution regarding Iran’s nuclear activities in March 2008, the South African ambassador to the U.N. stated that South Africa did not want Iran to possess a nuclear weapon capability, but also did not want to deny a Non-Proliferation Treaty member the right to peaceful nuclear technology.
South Africa has significantly increased its trade with Iran to $4 billion a year since 1995 when the two first signed oil storage agreements.  In 2007, Iran’s exports to South Africa neared $21 billion, primarily driven by South Africa’s crude oil purchases. As of 2006, South Africa received 40 percent of its crude oil from Iran. Despite interfering with its friendly relationship with the United States, South Africa agreed to store 15 million barrels of Iranian oil, gaining $208 million in the initial signing, but with the potential to earn up to 50 percent of the proceeds as the oil was sold.
Oil deals grew after 1995 and broadened into greater official cooperation beyond the energy sector. South Africa also increased its bilateral trade and corporate relations with Tehran so that by August 2008, South Africa put bilateral trade at $4 billion between the two countries. Pretoria also recently agreed to several joint development projects in Iran, including refineries and a massive mobile phone contract for South Africa’s Mobile Telephone Network (MTN). MTN alone invested $1.5 billion over 2007 and 2008, providing cellular coverage for more than 40 percent of Iran’s population. Iran generated over $160 million of revenue for MTN in the 2008 fiscal year, and MTN reported that it may lose over one month’s revenue due to Iran’s post-election unrest in the summer of 2009. In June 2009, Iran acquired a Nokia Siemens scrambling system to monitor and control mobile phones which were the primary source for disseminating information pro-opposition sites during the post-election unrest. Despite this economic blow to South Africa’s economy, MTN stated that they “want to keep the [Iranian] government happy since Iran is one of the [sic] its biggest markets, and they would rather lose market share than be kicked out altogether.”
In January 2009, South African Deputy Director-General and Foreign Affairs Ambassador Jerry Matjila discussed increasing bilateral economic cooperation with Iranian Deputy Minister of Economic Affairs and Finance Behrouz Alishihri during meeting in Pretoria. In May 2009, South African ministers participated in a large conference on foreign investment in Iran hosted in Tehran. In June 2009, the National Iranian Petrochemical Company announced that the South African Company, Sasoul, would be involved in Iranian petrochemical projects.
Iran supported the African National Congress (the majority party in the South African government) as long ago as the apartheid era and has since been a major supplier of oil and infrastructure aid to South Africa. A decade after the restoration of Iranian-South African diplomatic ties, South African Defense Minister Patrick Mosiuoa Lekota visited Iran to discuss defense related cooperation between South Africa and Iran. In March 2008, the two countries held a meeting in Tehran to discuss shipping and technical cooperation, and in January 2009 they held discussions in Pretoria on increasing bilateral trade, nuclear issues, and regional cooperation.